Suppose that the US interest rate is 10% and the Canadian interest rate is 10%. If the US interest rate rises to 12%, what happens according to covered interest rate parity?  The forward rate, quoted as US $ per Canadian $, will  (rise, fall) and the spot rate will  (rise, fall).

Answer rating: 100% (QA)

According to covered interest rate parity the forward exchange rate should adjust to ref... View the full answer